Barclays 2004 Annual Report Download - page 186

Notes to the accounts
For the year ended 31st December 2004
184
44 Analysis of cash balances
31st Dec 31st Dec 31st Dec 31st Dec
2004 Change 2003 Change 2002 Change 2001
£m £m £m £m £m £m £m
Cash and balances at central bank 1,753 27 1,726 (306) 2,032 751 1,281
Loans and advances to other banks
repayable on demand 2,710 817 1,893 (80) 1,973 (2,144) 4,117
4,463 844 3,619 (386) 4,005 (1,393) 5,398
2004 2003 2002
£m £m £m £m £m £m
Balance at beginning of year 3,619 4,005 5,398
Net increase/(decrease) in cash before the
effect of exchange rate movements 808 (372) (1,207)
Effect of exchange rate movements 36 (14) (186)
844 (386) (1,393)
Balance at end of year 4,463 3,619 4,005
45 Related party transactions
a) Subsidiary undertakings
Details of the principal subsidiary undertakings are shown in Note 50. In accordance with FRS 8, transactions or balances between Group entities
that have been eliminated on consolidation are not reported.
b) Associated undertakings and joint ventures
The Group provides certain banking and financial services for associated undertakings and joint ventures. These are conducted on similar terms
to third-party transactions and are not material to the Group’s results. Details of lendings to associated undertakings and joint ventures are set
out in Notes 13 and 14. Any loans are made on substantially the same criteria and terms, including interest rates and collateral, as those
prevailing at the time for corporate transactions with other persons and did not involve more than the normal risk of collectability or present
other unfavourable features.
Astron Document Solutions Limited (previously Edotech Limited), an associate until its disposal on 7th April 2004, provided printing services to
the Group. The cost of these services provided in the year was £35.3m (2003: £31.1m, 2002: £24.1m). At the end of the year, a balance
outstanding of £2.9m was included in sundry creditors (2003: £3m, 2002: £2.3m).
Intelligent Processing Systems Limited (IPSL) is a joint venture between the Group, Lloyds TSB Bank PLC, HSBC Bank plc and Unisys Limited.
The Bank has outsourced its cheque processing services to IPSL. The cost of these core services to the Barclays Group in the UK provided in the
year was £36.6m (2003: £26.7m, 2002: £30.2m). At the year end, a balance outstanding of £1.4m was included in sundry creditors (2003: £1.7m,
2002: £2.2m). In addition, a further £15.1m was included in prepayments and accrued income (2003: £16.6m, 2002: £6.3m).
Gresham Insurance Company Limited (Gresham) became an associated undertaking following the acquisition of Woolwich plc. The arrangement
enables Gresham to underwrite household insurances provided to customers of the Group. Underwriting payments made to Gresham during
the year were £81.9m (2003: £44.8m, 2002: £54.9m) and balances outstanding of £63.2m (2003: £53.2m, 2002: £6.9m) are included in
trade creditors.
Global Home Loans Limited (GHL) is an associated undertaking of the Group. Mortgage origination and processing activities are outsourced to
GHL and its subsidiaries. The fees payable to GHL during the year were £110.7m (2003: £100.7m, 2002: £57.9m). At the year end, £13.7m was
payable to GHL (2003: £11.2m, 2002: £8.9m).
Gabetti Holdings SpA, an associated undertaking, acts as an introducer of mortgage business to Banca Woolwich SpA and received commission
of £5.5m in 2004 (2003: £5.1m, 2002: £7m). At the year end, there were no amounts outstanding (2003: £nil, 2002: £1m sundry creditors).
The value of the Group’s investment in Gabetti Holdings SpA, based on its listed share price at 31st December 2004, was £9.9m (2003: £8.3m,
2002: £7.4m).